Number 44, Part 2: Still About Economy
Today in public begins what started yesterday afternoon in private. The second term of the 44th President of the United States. Many folks imagined today would be the 1st day for the 45th President of the United States but that will have to wait.
For me no matter what is said or done by the president today, the biggest questions still lie around the state of the economy. An economy that continues to grow will continue to also add to the presidents public mandate to lead on the agenda items he outlines and weaken his opposition.
Things look good right now but the last few summers have been tough for one reason or another after winter and spring brought the false hope of a faster growing economy.
We'll have to wait and see how the debt ceiling plays out this time. I suspect it should go better this time than last. The opposition will start running for re-election at the end of this year and control of the House and Senate is at stake. President Obama doesn't have to run for reelection and the GOP knows this.
Things look pretty promising on the housing front. Housing starts have started to spike over the last two years and this is great news. Housing starts are both an indicator of and a driver of economic strength. The fact that housing was at the core of this crisis is in my opinion the single biggest reason for sluggish growth instead of the boom we would have liked to have.
We've got a few hurdles to bypass or jump over this year. If we don't fall on our faces maybe our economy will continue to grow and the agenda of President Obama will have some support behind it.
Posted by Adam Ducker at January 21, 2013 8:54 AM
Things look good?
We are where Obama promised we would be back in 2009.
We have had four years of sub-par growth. We are falling behind and need to do much better in the next four years.
It is not really Obama’s fault. I blame him a little for misdirecting the stimulus and creating so much debt, but much of the economy is beyond presidential control.
If I could predict the economy, I would be rich, but it looks like we are in for four more years very similar to the last four years. Obama will no longer be able to blame Bush. On the other hand, if things get worse, Obama will blame Republicans and if they get better he will grad the credit.
I have 110 acres of 28 year old pine that I plan to cut in four years. I hope by then housing will have become reasonably healthy. Given my advancing age and the stubborn habit of trees not growing all that fast, it may be my last big harvest, so I have a personal interest in Obama success. On the other hand, Obama may tax it to such an extent that it might hardly be worth the effort.
The economy is starting to very slowly recover from Obama’s recession despite the best efforts of the Obama Gang to kill it.
In his first four years the only thing Obama and Gang have done is spend, borrow, spend, borrow, and spend even more. They have doubled the national debt, and are trying to doubled it again.
He’s raised taxes on folks making under $250,00 a year despite his promise not to. Obamacare has at least seven new taxes on these folks.
You better care what Obama says today. It’s gonna give insight into how he plans to put the screws to us over the next four years.
“Things look good?”
Yes. Three of the last four months showed decent economic growth in four key indicators and the 4th month was derailed because of the hurricane for the most part. Those who predicted a recession in 2012 are silenced for now as our economy continues with the incremental improvement.
“We are falling behind and need to do much better in the next four years. … but it looks like we are in for four more years very similar to the last four years.”
You can trash that argument along with your Romney/Ryan gear. That was Romney’s argument and your argument in support of Romney, after all. Unless the GOP forces more austerity somehow or forces us to default and get downgraded, we should see growth pick up this year and beyond as housing recovers. Unless inflation becomes an issue we should be in pretty good shape economically over the next four years.
The election is behind us. You are right about that. So why pretend anymore that growth rates of the last few years are good?
At the rate we have been going we will not catch up to where we would have been until 2025 and we will catch up to where we should have been … never.
Unemployment is still more than 7% and only that “low” because lots of people have left the labor market. I doubt that it will get to the pre-Obama twenty year average any time during the Obama time.
You know in the twenty years before Obama took office, the WORST unemployment rate was 7.8% and you think unemployment level that is as bad as the worst is looking good?
Enjoy the day my democrat friends. I expect the economy to improve despite anything obama might, or might not do. I also expect another $4 Trillion to be added to the national debt before the end of this term.
“Things look good?”
Yes. We have enjoyed four years of growth. Not “sub-par” growth. Sub-par would be less than zero, such as what happened when Republicans were in charge. Remember how bad that was? In the last month of the Bush administration, the economy shed 800,000 jobs. At the end of the economic collapse, GP shrank 8.9%. Now THAT’s a sub-par performance. Housing prices dropped dramatically, wiping out the wealth of the middle class.
It’s been a great four years for me and my family.
We experienced the despair of seeing conservative Republican policies destroy the economy, crash the stock market, and drop the value of our house by several hundred thousand dollars. I lost my job. My wife lost her job. My son was unemployed too. My daughter was a student in college.
Now my son is employed an on salary. My daughter graduated. I’m only 56, my wife is 55, and we’re retired and modestly wealthy, thanks to one of the greatest bull markets for stocks in American history. Housing prices have recovered in my area, and my house started appreciating again. Four years of Obama worked out great for me.
And the prospects for the next four look good too! Adam, you’re right. Short of the GOP somehow bringing back the kinds of disastrous policies that killed the economy under Bush, there’s every reason to expect housing prices to continue to appreciate, a bull market in stocks to continue, and employment to continue slow but steady growth.
I was particularly glad to see Obama address Global Warming in his inaugural speech.
In terms of the politics, it looks like Obama may be able to control the House through a combination of Democrats and 50 to 80 Republicans. The remaining 150 - 180 Republicans have become so extreme and destructive that a significant number of their party will no longer go along with it. Obama has used this to pass the fiscal cliff compromise and force the conservatives to back away from intentionally harming the country with debt ceiling blackmail.
So! It’s never easy, of course, but it’s easy to be positive about the future, thanks to the Democrats, and thanks to the Obama administration.
“I’m only 56, my wife is 55, and we’re retired and modestly wealthy, thanks to one of the greatest bull markets for stocks in American history.”
OH…NO…those greedy corporations made you money? What a nasty surprise for the OWS bunch.
So, not pulling your weight or paying your fair share? Royal is right, the OWS should hate you.
Your post is very interesting. We can boil it down to “I got mine. My kids are doing okay and the losses other people suffered on their homes has benefited me.”
This is very liberal. As I recall, you are also against means testing for SS and raising the retirement age. Works out well for you, doesn’t it?
Sluggish economy. Ridiculous debt. Higher taxes. Loss of freedoms.
Yep, the next four years are going to be great.
Do you guys just like the sound of the word?
Because, it doesn’t mean what you seem to think it means…
“In the last month of the Bush administration”
You mean, with the Democrat controlled House and Senate?
What came out of those houses of government were Republican policies?
This is an interesting concept, please tell me more.
Oh, I’m not too worried about pulling my weight. I was taxed at the absolute maximum when the stock options were exercised (which means the conversion from option to stock was treated as a taxable event, although nothing was actually sold), and I paid well into the six figures in federal taxes alone.
I want to remove the cap on Social Security and lower the retirement age. I have no problem paying taxes when it ultimately benefits my family and my community. When my family and my community benefit, I benefit.
And that is what being a liberal is all about.
Of course, I also happen to be one of the least materialistic people you’re likely to meet. I like good food and I like to travel. I think indoor plumbing, toilets, and showers are the best thing civilization has to offer. Other than that, and meeting basic survival needs, I don’t much care about the things money can buy. So maybe that lack of greed makes it easier for me to be a liberal and care about my family and my community.
I expect that obama will shed any illusions of being a moderate and allow his full blown liberalism to be revealed. He will pander for more discretionary spending on “special interest groups”, intrude even deeper into unconstitutional executive actions, erode further silly notions of individualism, drive for success and ambition based upon hard work and dedication.
He will find new “rights” to exploit and constitutionally recognized rights to diminish or destroy. He will weaken our national security. He will encourage more government intrusion for more people. He will advance this nations moral decline. He will slow our use and development of our fossil fuel resources, and oversee a further decline of middle America.
C&J: “So why pretend anymore that growth rates of the last few years are good? … the WORST unemployment rate was 7.8% and you think unemployment level that is as bad as the worst is looking good?”
Is anyone pretending that, though? Is anyone suggesting this current level of economic growth or unemployment is good and that we shouldn’t do better? You can’t just add context in where it doesn’t exist.
So maybe that lack of greed makes it easier for me to be a liberal and care about my family and my community.
No, that lack of personal greed makes it easier for you to be a progressive and see the wealth as another as something to covet. When you say “I don’t mind taxes as long as they benefit me and my community”, that tells us that you have no problem with taxing others and their communities as long as you see some benefit with it. And you don’t mind using the threat (or real implementation) of force on those people. As long as you agree with the laws being enacted (ie, you don’t have to worry about force being used on you).
That’s much more insidious than just someone who is ‘greedy’ to ensure that he can take care of his family and provide their next generation with a bit of an easier life. I would prefer that type of greed over your type of greed any day.
BTW, it is sad that to feel good about yourself you have to harm so many others.
OH, and the fact that you are willing to use force to force your morals onto others puts you in the same camp as the far right religious people who want everyone to live by their moral code.
The only difference is that you agree with one set of morals and don’t necessarily agree with the other. The method of destroying an individual’s rights is the same.
There’s a good reason no one votes Libertarian. There’s a good reason over 51% of all American voters elected Obama. Twice.
Perhaps you just dislike your fellow Americans. They’re a bunch of freeloading moochers, ya know, and they just want free stuff.
But feel free to throw out some conspiracy theories to explain it why Americans overwhelmingly voted for Obama, and why no one will come within a country mile of electing Libertarians. Blame the media! That’s always a good place to start. And then throw in something about how Libertarians are just misunderstood. Remind everyone that the collapse of the financial sector at the end of the Bush administration was really due to a change in accounting rules, not a problem with a lack of government regulation and oversight, or, heavens forbid, the free market. Reminbd everyone how it would have been better to let the economy crash into a Great Depression; after all, that would have been better than gub’mint intervention. Go for it. Because what you advocate would have caused widespread suffering and terrible hardship for every person reading this. Oh! One more thing!
Don’t forget to stock up on guns!
You are the epitome of cognitive dissonance, I read what you write and can only shake my head.
The “wealth” of the middle class isn’t their home and never has been. Your home is a giant liability unless you own it outright which a teeny fraction of homeowner’s do. The second you can’t pay your bills, your home eats you alive. That isn’t wealth. If your home’s value in fiat garbage paper dollars stays the same, but ‘real’ inflation is at 8%, guess what, you took a serious bath.
Debt, is what wipes out wealth. DEBT. You liberals think the spending can go on forever, this is America, home of the handout, free money forever. You have no idea what is coming because all you can see with your head that far up Obama’s ass is the bullshit he’s feeding you through a propaganda machine so extensive, it would make Goebbels green with envy.
I had a client in my office today whose entire business model is based on federal government handouts to Alaska Native Corporations. They kept going on about their unique business model and value… It was all I could do to just smile and nod and tell them I didn’t think it would be a good fit.
Keep smoking your hopium. Bush led us down the primrose path with his rampant spending, but the cliff is far behind us now. Everyone’s trying to manipulate and cheat and steal as much as they can, as fast as they can, before it all collapses, and that day could be 2 years away, or two months away depending on world events.
4 more years of this is good? Only if you’re utterly blind to economics.
The wealth of the middle class has been closely tied to the value of their house.
If you have never owned a house with a mortgage, then perhaps you are unfamiliar with the concept.
If there is inflation, then a house is probably the best investment you could make.
According to Keynsian economics, we do best when we live in a demand driven economy. What went wrong during the Bush administration?
Wages for most people stayed flat. Profits from increased productivity went to the 1%. Jobs went offshore. Meanwhile, tax cuts in 2001 and 2003 were supposed to pay for themselves. They didn’t. Two wars were fought on the national credit card.
The only way the economy could grow between recessions was through increased debt. Private debt. Debt in the form of refinancing and credit cards, as well as public debt, in the form of a deficit spent by the government on Iraq, Afghanistan, the RSA, and private health care price increases that were passed onto the public health care sector.
Faced with a staggering economy, Greenspan kept interest rates as low as possible. Unfortunately, it encouraged more and more speculation in housing. When commodity-fueled inflation kicked in due to rising oil prices, the Fed had its hand forced. Greenspan had to increase interest rates. Real estate began to collapse… And boy, was it a long way down. In the financial sector, unregulated securities related to housing had boomed into a multi-trillion shadow industry, trading without oversight or regulation- the assumption was that housing prices would not drop; after all, they had never suffered a severe drop in living memory… and it turned into a complete disaster.
Well, I’m pretty comfortable with my understanding of economics, I’ve put it in writing, and I’ve had the pleasure of being proved right by reality, both during the Bush administration, and during the Obama administration.
Can you say the same?
There’s a good reason no one votes Libertarian. There’s a good reason over 51% of all American voters elected Obama. Twice.
There are actually lots of good reasons. None of them you will like, you rather like to think that the majority of Americans are progressive. I’ll let you keep your fantasy, your religion wouldn’t let you understand the reasoning behind it…
Perhaps you just dislike your fellow Americans. They’re a bunch of freeloading moochers, ya know, and they just want free stuff.
Yeah, again with the moral superiority crap, phx8? That’s the faith of the progressives speaking loud and clear. Supporting the mindset because it is a way to display their moral superiority that they think that have…
I’ll put my care for my fellow man up against yours any day. I actually go out and help people, not just elect people with guns to make others pay for other people to help. I’ve started and worked for three different charities centered directly on helping poor through housing, financial and mentoring. When I help them, though, they are truly helped and become productive members of society. Sure, I could be rich, but I’m not. I don’t have the stock options to cash in and pay taxes on because I give my money, freely, to people who need help. I don’t have the luxury of your problems that you feel smug about.
I also care enough about my fellow Americans to not want us to point guns in their faces in order to push my morals onto them. If they want to be selfish, that’s their option as free human beings. You apparently don’t think so and feel it ok to sentence them to death just because they have a flaw you disagree with.
But feel free to throw out some conspiracy theories to explain it why Americans overwhelmingly voted for Obama
Not really a conspiracy, different people voted for different reasons. Again, you have no interest in discussing them though, that pesky religion of yours.
But I will remind you that if not for Libertarians voting for Obama, he wouldn’t have gotten elected. that’s the way these things go, independen and libertarians are the ones who decide these elections. If you want to keep insulting those people, go ahead. We’ll see how well it plays out for you in the future.
and why no one will come within a country mile of electing Libertarians.
Hmmm, that’s an interesting thought. Nevermind that hundreds of libertarians are holding office around the country and have been for a couple of decades. Because no one will vote for them. Except they get more votes than any other 3rd party candidate, with over a million votes for president this year, those numbers increasing…
Yeah, best to ridicule people who aren’t part of the moral majority, right? That’s what the Democratic Party has become, the new Moral Majority. How does that feel? Has to feel pretty warm all over for you, being superior and being able to make others act the way you think they should.
Blame the media!
No, the only problem are the two parties in charge now that control a) access to the debates and b) access to the ballots.
That’s always a good place to start. And then throw in something about how Libertarians are just misunderstood.
Not misunderstood. Lied about. You know, like you like to do.
Remind everyone that the collapse of the financial sector at the end of the Bush administration was really due to a change in accounting rules, not a problem with a lack of government regulation and oversight, or, heavens forbid, the free market.
Wouldn’t do any good, people don’t like hearing the truth. Tell me, phx8, what lack of government regulation EXACTLY. I really dislike when people who lack real understanding of the issues try to act superior but can’t even explain the details of their understanding and just repeat rambling talking points that they’ve heard… But you get used to it in today’s sound bite society.
Reminbd everyone how it would have been better to let the economy crash into a Great Depression; after all, that would have been better than gub’mint intervention.
Considering it was government intervention that CAUSED it… And no one suggest such a thing, but that would mean you would be dealing with actual fact, which I haven’t seen much of in your ‘response’.
Had the Democrats did what they should have in September 2008, but waited until February 2009, there would have been no need for TARP. The banks would not have needed to be ‘bailed out’.
Of course, now that money was spend (and returned and spent on other things) we can’t possibly not spend that money again every year from now on, or that would be ‘draconian cuts’.
Go for it. Because what you advocate would have caused widespread suffering and terrible hardship for every person reading this.
Since you have displayed that you haven’t a single shred of understanding about what I would or wouldn’t advocate, you keep telling yourself that. It helps with the religion…
Oh! One more thing! Don’t forget to stock up on guns!
Odd swipe to take at someone who doesn’t mention ‘guns’ in any post and who isn’t a member of the NRA (but is a member of the ACLU).
But oh well, it makes about as much sense as everything else you’ve written.
Obama won with 51% of the vote. The Senate picked up two Democrats, despite a huge mathematical disadvantage. Democrats also picked up seats in the House. That’s no “fantasy”. It’s certainly a majority of votes in the Senate. Whether it has anything to do with a Moral Majority remains to be seen. “We the People” continue to work towards a “more perfect union” and “promote the general welfare.”
Libertarians voted for Obama? Really? Well, they certainly didn’t vote for other Libertarians in any great number, so maybe that’s the case.
That’s good that you engage in charitable activities.
More Perfect Union? General Welfare?
Again, I don’t think those words mean what you think they mean…
Let’s see, increased tax burden on all Americans, further erosion of individual rights through spying on Americans, increased fighting of the drug war, wars in five separate countries, forcing people out of the country by making individual decisions illegal and increasing taxes, a president that thinks he has the right to kill Americans without trial, military tribunals, torture, expanding the war on terror, use of drones outside and inside the country, test scores dropping, health care declining and becoming even MORE expensive…
Well, I could go on but you’ll tell me now how all of those things are important, despite how terrible they were when Bush was doing them, but hey, whatever it takes to force your moral views onto others with the use of law enforcement paramilitary SWAT teams and guns!
The real sad thing is that the Libertarian party you despise was the Democratic Party of the past, the ones that fought for the rights of the citizens (all of them, not just a portion of them). They are the party of Jefferson, not the authoritarian progressives that now run the Democratic party today.
Truly, I don’t despise the Libertarians. And I actually agree on some of the areas where the Obama administration receives criticism, particularly when it comes to foreign policy. I don’t perceive it in the same light as you, but I’m fine with people holding the administration’s feet to the fire. I wish the conservatives/Republicans would spend more time critiqueing real foreign policy issues, like drone warfare and defense spending, and less on ridiculous conspiracy theories like Benghazi. When it comes to foreign policy, they really have become completely useless as an opposition party. Blame it on Bush and the Neocons, I suppose. Hard to get over something that messed up.
But credit Obama too. He’s done a good job in many respects. Perfect? No. However, he has managed to wind down the War in Iraq, and Afghanistan seems to be ending too. Bin Laden is dead. Authoritarian regimes have fallen in the Middle East, including Khadaffi, and those peoples have the opportunity for self-determination, and it has all been accomplished at a minimum cost to us, and without American casualties! Also, if Obama goes with Hagel at Defense, maybe there will be some long overdue cuts in defense spending. What I’m saying is that, in general, there are some successes; Obama seems to be moving the country in the right direction when it comes to foreign policy, even if the movement is slow.
My biggest criticism of Libertarianism is its inability to deal with the modern world, in terms of the role of government v business, and in terms of providing for social welfare. The days of the Jeffersonian gentleman farmer are long past. It’s a nice idea, but it’s just not an option anymore. Being free from government and taxation in order to promote rugged individualism sounds great, but that same government is needed to preserve some degree of freedom. Nature abhors a vacuum. So do big businesses. Without banding together through our government, we devolve into a plutocracy, with most of the wealth concentrated in a tiny fraction of the population, while the vast majority of Americans end up just as ‘free’, yet little better off than the peasants of Central America.
Interestingly enough, there was study just done showing economic mobility is lower in the US than in the socialist democracies of Europe.
I don’t perceive it in the same light as you
You mean the blatant hypocrisy.
I wish the conservatives/Republicans would spend more time critiqueing real foreign policy issues, like drone warfare and defense spending, and less on ridiculous conspiracy theories like Benghazi.They are loving what this administration is doing, why would they critique that? They are getting more and more power to do what they want when they return to power. Basically, the lack of moral outrage that was present when Bush was in office has ensured that any new and current president has all the power they could ever dream of.
he has managed to wind down the War in Iraq
Thanks to Bush. Obama was trying to leave troops there. He did manage to keep around 100.
” A 2008 security deal between Washington and Baghdad called for all American forces to leave Iraq by the end of the year, but the White House — anxious about growing Iranian influence and Iraq’s continuing political and security challenges — publicly and privately tried to sell the Iraqis on a troop extension. As recently as last week, the White House was trying to persuade the Iraqis to allow 2,000-3,000 troops to stay beyond the end of the year.”
Afghanistan seems to be ending too.
I’ll believe it when I see it.
“Top Obama administration officials want to keep around 10,000 U.S. troops in Afghanistan when formal combat ends in 2014, cementing a limited, long-term American military presence in the country if Kabul agrees, said senior U.S. officials.
A post-2014 troop level of that size would represent the midpoint of preliminary recommendations by Gen. John Allen, the commander of U.S. and international forces in Afghanistan. Gen. Allen has proposed maintaining a force between 6,000 and 15,000 U.S. troops to conduct training and counterterrorism efforts when the North Atlantic Treaty Organization mission formally concludes at the end of 2014, officials said. In contrast, the U.S. maintains no residual force in Iraq, a situation that has been blamed for instability in that country.”
Unconstitutionally. Funny thing about the Constitution, if you think you can ignore one part of it, you have no defense of any of it…
Obama seems to be moving the country in the right direction when it comes to foreign policy
His drone strikes, why have skyrocketed (pun not intended) during his administration, have killed many innocent people creating a groundswell of anti-American sentiment, the kind of which have caused us problems for decades. Right direction? I find that disturbing if this is the ‘right direction’.
Being free from government and taxation in order to promote rugged individualism sounds great, but that same government is needed to preserve some degree of freedom.
A perfect example of your inability to actually understand what Libertarians stand for. They are not about ‘rugged individualism’ (and when I hear that catch phrase, it lets me know the person who said it is either ignorant of the topic or purposefully lieing about libertarian thought). They are not anarchists. Of course we need government and we need laws, but those laws should only be to keep individuals from infringing on the rights of other individuals and ensuring that the market is free, not picking sides. Stephen even mentions this as one of his views, but abandons it every chance he can to defend his party.
there was study just done showing economic mobility is lower in the US than in the socialist democracies of Europe.
That you seem to think that this is because of too little government, and not too much, is again disturbing. We are now less free in this country than Canada, and you seem to think we are the Wild West with no laws…
Again, you can have your religion of force and authoritarianism, I’ll speak out and vote against it every time I see it rise it’s head.
I grew up in a shitty trailer. My parents told me, “if you want to go to college, just know you’re not getting one red cent out of us,” and since every college application has an “EFC” field - the Expected Family Contribution, which determines your ability for almost all student aid, I was screwed (they made great money by the time I was graduating) so I joined the Navy and did it the hard way. I still have a mortgage on my house, AND my one rental property, so I am very familiar with the situation. I am also keenly aware of the hours I spend to earn the money it takes to pay for everything because I don’t take a nickel of government money and I don’t accept clients who’s business model is based on money from the government tit - as a point of personal pride.
You quote Keynesian Economics like the gospel, when Keynesian Economics is in its death throes in EVERY major developed nation in the world. You obviously don’t read any international financial sector news, or study market charts very often. The basis of Keynesian Economics is that demand and supply aren’t always the same (duh) but (and here’s the fallacy playing out right now) the best way to handle the inequity is to for nations to manipulate their currencies. Every single civilized nation that has adopted this policy to any degree is now in danger of default and is horribly mired in debt. Keynesian Economics is a farce that works well when you begin, but eventually implodes your currency, some argue that implosion is the point but I don’t give Keynes and the banking cartel credit for that level of visionary evil.
Do some learning. You are lucky, and got to ride the good times wave as our ‘dear leaders’ have gotten more and more brazen with the debt and erosion of liberties. But we, as a nation, are so precipitously close to a black swan event (look it up) that I pity you if you have your investments and holdings in fiat money. The same fiat that a Keynesian Economist thinks is sound. BWAHAHAHAHAAAAA.
You are also clueless if you think purchasing a home and then experiencing inflation is ‘the best investment you could make.’ I might agree somewhat if you were purchasing the home with the express purpose of renting said home out to the surge of renters who can’t afford a mortgage, but you didn’t specify that and foolishly believe that the home you live in is an asset while it still has a mortgage. Yes you have equity in it, but Obama has now made that equity taxable at the capital gains rate regardless of the number of years of occupancy (you used to get a pass after 2 years) and you can only get your hands on that money by selling the house you occupy. It’s poor person thinking to believe that an asset that will eat your lunch the moment you stop paying for it, is some kind of an asset - regardless of the equity you now have to have about 25% of the homes value in, + a usual 6% commission, in order to just BREAK EVEN on the sale. Study an amortization table. You’re over 10 years in before you are at that point in equity on any loan, and the average homeowner sells and moves every 7 years.
YOUR HOME IS NOT AN ASSET. YOU THINK LIKE PEOPLE WHO LIVE PAYCHECK TO PAYCHECK.
I could point out the million+ homeowners who learned this sad fact, but you would probably give me another foolish idiom about Keynes.
If you look at economics through the media-spoonfed lens of your very lucky life timing, your point of view makes a small amount of sense. If you look at debt to GDP ratios between the US and all other civilized nations, and see what is happening to those nations who have manipulated and “eased” their currency, you will see the fiscal splat that virtually everyone recognizes is coming, but no one has the courage to face because everyone is just ‘getting while the getting’s good’ and to hell with what comes after, because what comes after is so scary no one wants to think about it.
Libya represents a unqualified AND constitutional foreign policy success. It represents a template for how to do it right- to accomplish foreign policy goals, encourage the spread of our best ideals, and do it with a minimum cost, no loss of American lives, in cooperation with our allies, and without putting “boots on the ground.” The bad guy- one of the very worst ones out there- is gone.
It really takes some effort to imagine a way that action could be seen as unconstitutional.
Face it. Obama is doing a terrific job.
First, a general observation. Deep down, we never really change who we are. Maybe it’s a matter of nature and genetics. Maybe it’s nurture, or a social class thing. Recently I was talking with my Mom. My parents have been comfortably retired for some time, but my Mom grew up very poor in the Deep South. And when we were talking, I observed that, while everything seems well enough now, at least in terms of finances, some things can never change for her and for me. “Deep down, I will always feel poor.” It’s kind of funny, because it turns out we both stash away small bills in hiding places. I think I’m just the bees knees if I have a small amount of money hidden away, just in case…
Well, that’s neither here nor there.
As for economics…
There will always, always, always be pessimists about the economy. There will ALWAYS be bears. There will always be dire prognostications of doom and gloom. And yet, here we are today. You know, it’s much more rewarding and much more profitable to be optimistic and bullish.
And yeah, I know, sometimes gloom and doom are warranted. We’re miles away from that situation right now.
The idea that gold somehow has an intrinsic value, while a fiat currency does not, is simply ludicrous. The value of both gold and paper money is ultimately an illusion, an agreed-upon illusion. Neither produces anything, earns anything, generates a profit, or performs in any way whatsoever. It’s simply a medium of exchange. The gold standard went away forty years ago, along with monarchies and horse calvary. Today, not one country uses the gold standard. If kingdoms make a comeback, maybe gold will too. Until then, it’s a sucker’s bet.
Today, China is the biggest producer of gold.
Anyone think the gold standard is still a good idea?
Not everyone believes in American Exceptionalism.
Australia holds the largest reserves. The Aussies are nearly unanimous about the dangers of Global Warming and the need to address it. Now. It’s hard not to notice it Down Under, given some of their recent experiences. While the Aussies are a wonderful people, how long will they continue to feel friendly towards Americans if we keep chanting “drill, baby, drill”?
It really takes some effort to imagine a way that action could be seen as unconstitutional.
No, it just takes a few seconds of reading the constitution…
Article 1, Section 8, of our Constitution is unambiguous: Only Congress has the authority “to declare war.” James Madison warned that allowing the President to take the country into war would be “too much of a temptation for one man.”
The President does not have power under the Constitution to unilaterally authorize a military attack in a situation that does not involve stopping an actual or imminent threat to the nation.
As Commander-in-Chief, the President does have a duty to protect and defend the United States. In instances of self-defense, the President would be within his constitutional authority to act before advising Congress or seeking its consent. History has shown us time and again, however, that military action is most successful when it is authorized and supported by the Legislative branch. It is always preferable to have the informed consent of Congress prior to any military action.— B. Obama
The President has the solemn duty to defend our Nation. If the country is under truly imminent threat of attack, of course the President must take appropriate action to defend us. At the same time, the Constitution requires Congress to authorize war. I do not believe that the President can take military action — including any kind of strategic bombing — against Iran without congressional authorization. That is why I have supported legislation [GG: also supported by Obama] to bar President Bush from doing so and that is also why I think it is irresponsible to suggest, as some have recently, that anything Congress already has enacted provides that authority. — H Clinton
Leading Democrats constantly argued the same thing during the Bush years: that Presidents lack the power to order military actions in non-emergency, non-self-defense situations without Congressional approval; indeed, they insisted that even the attack on Iraq, which (unlike Libya) was justified as necessary for self-defense, required Congressional approval [and, needless to say, the always-principled Republicans routinely argue that Presidents do possess unilateral war-making power whenever there is a GOP President, but argue the exact opposite when there is a Democratic President]. There has to be some purpose to Article I, Section 8′s assignment of the power “To declare War” to Congress; what is it? As Yale Law Professors Bruce Ackerman and Oona Hathaway put it:
No existing statute or treaty allows this action. Gaddafi isn’t linked to Al Qaeda, so an attack against him isn’t supported by the resolution authorizing force against terrorists involved in 9/11. If Obama goes it alone, he must return to Bush-era assertions that the president, as commander-in-chief, can unilaterally launch the nation into war… .
We are at a crossroads. President Obama can deal a death blow to our constitutional commitment to checks and balances in war-making. Or he can establish a precedent in constructive congressional engagement which will serve as a model for the foreign policy challenges of the twenty-first century.
In fact, it takes a LOT of effort to somehow see the Libyan action as constitutional at all.
The bad guy- one of the very worst ones out there- is gone.
That didn’t seem to be enough reason to support Bush taking down Saddam, who was much worse than Gaddafi, and he even had enough sense of the constitution to seek congressional authorization even though he was making the case that it was an action of self defense, a claim that Obama could clearly not make with Libya.
As usual, as soon as the parties change power, so do the ‘principles’. :/
Face it. Obama is doing a terrific job.
Yes, of expanding presidential power beyond the constitutional limits and destroying the remaining power that the constitution still has left…
We’re miles away from that situation right now.
Interesting, so why is Fitch talking about lowering our credit rating if we don’t do something about medium term debt? I suppose they are just racists…
However, Fitch also warned that fundamental strengths in the US economy were being undermined by the weight of debt and associated strains.
Fitch warned, that even if a crisis over the ceiling were averted in the immediate future, if the solution did not address the debt in a way which supported growth, then it was set to downgrade the US rating later in the year anyway.
Couple that with the fact that we are no longer bringing in more SS than we are spending, we are having to cash in on those IOUs since we’ve already spent that money, requiring more lending. And that projected out that in a few decades we will not be 100% debt/gdp ratio, but more like 800%.
Again, when the Republicans controlled the House, Senate and Presidency, the Democrats decried the ‘runaway spending’ and debt ratios… But when the parties change place, everything is suddenly ok in the world, even though those numbers are much more worse than they were then…
It must be tough, Rhinehold, finding something to be negative about, even when there’s virtually nothing to work with. The linked article about Fitch concerns the debt ceiling. Only one phrase gives you hope to see your dire pessimism rewarded. Unfortunately, the phrase about how a solution to the debt ceiling must somehow support growth, well, why would anyone want a solution that supports contraction? It’s nonsense.
I don’t know who originated the saying…”A fool and his money are invited everywhere”, but it is certainly apropos of the obama administration and his congressional supporters.
We have witnessed the “fool” being elected twice by folks expecting the fool to spend money on them.
The wealth of a nation comes from the productivity of its people, not debt. Does deficit spending make our nation more productive? Of course not. Does government forced sharing the wealth of some individuals make our nation more productive? Of course not.
Subsidizing poverty to the extent that those impoverished feel no need or reason to improve their lot borders on the ridiculous.
The price this nation will pay for its spendthrift ways can not be measured today, but the pain will surely be felt tomorrow.
why would anyone want a solution that supports contraction?
I don’t know, yet that is what we have now. A solution that doesn’t address debt, increases our debt to gdp ratios to those only seen before during WWI and projected to climb even higher.
And we are told by the president, repeatedly, that we don’t have a problem. It’s like a alcoholic that ‘doesn’t have a problem’ and ‘can quit anytime they want’…
And the progressives that support him like you are just enablers…
The US has seen productivity grow by leaps and bounds over the past several decades, yet the wealth of the nation has not increased for the vast majority of the population. The technology has improved. But an increase in wealth? Not so much. Since 1980, wages for most people have remained flat. Only the 1% have gathered the wealth that came from increased productivity.
Furthermore, the financial sector has become a major center of profit for… well… the financial sector. You read that right. Virtually no one has benefited from the move towards plutocracy and plutonomy except for the plutocrats, especially those in finance. They produce nothing. The provide no real services to justify those enormous fees and bonuses.
THAT is what needs to change. Productivity needs to change only in the sense that we need to actually PRODUCE something, preferably through manufacting. Offshoring manufacturing plants was a complete disaster.
Only about 6% of the federal budget goes to paying interest on the debt. Sorry to disappoint your gloom fest, but we’re not even close to contracting because of debt.
You’re getting caught in Republican talking points when you join in the chorus about debt. The same people who denounce the debt today are the ones who didn’t say boo when Reagan, Bush #41, and Bush racked it up. Those conservative Republicans are effectively denouncing the results of their own past policies!
Only about 6% of the federal budget goes to paying interest on the debt.
Interesting, I didn’t even mention interest on the debt, that’s not the (only) problem. Mandatory spending, which is just Medicare, Medicaid and SS, currently makes up over 60% of the spending we do, soon to reach 70%. And without any modifications to these programs, that will increase dramatically now that we are bringing in less in SS taxes than we are spending out, even with the recent tax hike. So we have to pay back the IOUs that we left laying around when we spent that SS surplus on other things.
The same people who denounce the debt today are the ones who didn’t say boo when Reagan, Bush #41, and Bush racked it up.And the same ones who denounced it when Bush racked it up aren’t saying boo about it now when it is so much worse. Like this guy:
“The problem is, is that the way Bush has done it over the last eight years is to take out a credit card from the Bank of China in the name of our children, driving up our national debt from $5 trillion dollars for the first 42 presidents — number 43 added $4 trillion dollars by his lonesome, so that we now have over $9 trillion dollars of debt that we are going to have to pay back — $30,000 for every man, woman and child.
That’s irresponsible. It’s unpatriotic.” — B Obama
Meanwhile, those of us who were against Bush’s debt are even more worried about Obama’s… We weren’t big fans of Clinton’s either (who ran a public debt increase every year he was in office).
BTW, that number owed per person now over 50,000, and growing. Our current debt today is: 16,432,619,424,703.06
I know your religion is not going to let you see the facts as they are, but perhaps someone else reading this who isn’t closed off to the president being anything but a messiah might get something from it.
Productivity is measured by certain formulas just as Cost of Living Indexes and other government calculating is performed.
You seem to understand phx8, that what I refer to as productivity is not the same as that being measured by government. What our government seems to tout as great productivity is hardly the formula for making our people better off financially.
“Over the long run, gains in domestic productivity should translate into higher living standards and more jobs for U.S. workers. Economic theory—and common sense—tells you that companies will want to hire more of the types of workers who are contributing to higher profits. If the profits are coming from improved factory productivity in Dearborn, High Point, or Mountain View, then the company will want to hire more good production workers at those plants.
“Supply chain” productivity doesn’t work the same way. If companies reconfigure themselves to better scour the globe for the lowest-priced goods and services, then their essential personnel are multilingual business school graduates with the ability to parachute into Shanghai or Bangalore and negotiate the best deals with suppliers, logistics experts who can keep the goods flowing, marketers to sell the goods, and software engineers to program the computers that communicate with the suppliers. In other words, the bulk of the company’s own workers essentially perform a creative or coordinating function, rather than a manufacturing one. These workers might be in the U.S., or they might be spread around the world.”
By the way, in his inaugural address, Obama called for an end to perpetual war. Bad news for the Military-Industrial Complex.
“Supply Chain” productivity (better known as offshoring, the pinnacle of Marxist alienation of labor) is precisely the problem, because the supply chain extends beyond national boundaries, yet the producer has every intention of selling the product or service back inside those same boundaries. This results in greater corporate profits and huge CEO bonuses even as it exerts downward wage pressure. Ultimately, it puts Americans in the impossible position of not making anything, and merely providing services to each other. A national economy built upon coordinating and creating is simply not sustainable. The offshoring essentially allows those companies to become parasites upon the economy, making profits without contributing to the market of purchasers, whether it’s jobs that pay taxes, that build infrastructure, that provide safety and a healthy environment while educating the populace, and so on.
The conventional wisdom used to be that the Shumpeterian “creative destruction” of capitalism would result in obsolete industries being offshored while new ones arose to take their place. Unfortunately, advances in technology have gone so far, even the sources of innovation have been offshored, including computer programmers and many IT functions.
In a nutshell, instead of selling to others the rope to hang us, we’re having them produce the noose for us, and then we’re pleased because our hanging will be so cheap.
For anyone interested in Marx’s theory of alienation of labor, here’s link to the wikipedia article:
Whether one accepts the class aspect of it, the theory does provide some important concepts for analyzing what we’ve become.
”.. We weren’t big fans of Clinton’s either (who ran a public debt increase every year he was in office)”
No, he did not! The debt owed to the public went down in two of his years in office.
The only reason that “total debt” increased each year was because the SS surplus exceeded the surplus of general revenue over expenditures. If the federal government’s general revenue budget was perfectly balanced but SS had a surplus of revenue, total debt would always increase. SS surplus by law is required to be invested in US Treasury bonds which necessarily increases total debt but not public debt.
My context is that you say that things under Obama now look pretty good. In the context of any other president for the past 20 years, they look abysmally bad.
7.8% unemployment is simply terrible. I know you all say Obama inherited a mess, but after four years we are much deeper in debt and unemployment is about the same.
So you paid a tax rate of how much? It sound to me like you paid Romney rates. Did you also give a third of your income to charity?
Re liberals - you cannot be generous with other people’s money. Every American has the option of being generous with his/her money. Liberals want to coerce others to pay. This is not the moral high ground.
“There’s a good reason over 51% of all American voters elected Obama.” Barack Obama was reelected by a smaller majority than his first election. This is uncommon. Re his popularity, Obama was reelected by almost exactly the same % as George Bush was in 2004. So more or less Obama = Bush. I don’t recall you all thinking Bush was so great and demanding other fall in behind him.
The last time we got a really popular president was Ronald Reagan with almost 58%. Now that what what a mandate looks like. Squeaking by like Bush and Obama did still makes you president, but it does not give as much political capital as Bush or Obama thought/thinks.
C&J: “My context is that you say that things under Obama now look pretty good.”
And my context is that I’m referring only to the last few months for accelerating growth and I’m not suggesting this is a stopping point for either growth of unemployment.
“In the context of any other president for the past 20 years, they look abysmally bad.”
And yet no president in the last twenty years faced even close to the economic conditions that President Obama has helped lead us out of. You can make a snapshot in time seem terrible but this is a case where you must consider where we came from to get back to here. You act like the president has kept unemployment at 7.8% for four years since it was around here when he started and still is. You use that to imply there’s been no growth and there will be no more growth for four years.
“I know you all say Obama inherited a mess, but after four years we are much deeper in debt and unemployment is about the same.”
Yes, unemployment is about the same, except it’s going down from 10% instead of up when we started the crisis. Yes, we are much deeper in debt because we had to be. What would you have had the president do to prevent the debt? His new spending is a tiny fraction of the debt spread out over many years.
You can’t say what you’d do because there was no solution that would have us survive the recession and keep our debt level sane. This is why many Americans don’t trust the TEA Party to lead. They’re 100% rhetoric and 0% viable solutions.
Spoken like a spoon-fed Keynesian. The difference, and dare I say, GLARING difference between fiat paper and Gold is that YOU CAN’T PRINT GOLD.
You are right, in that Gold has no value in and of itself. You can’t eat it, it won’t keep you warm, and the amount of it needed to provide shelter… for Pete’s sake, you get the drift. But Gold is what NATIONS use as a hedge against possible currency devaluations and manipulations and wars. That fact alone, that the Nations use it, and not more paper as a hedge belies the truth you deny behind your foolish Keynesian podium. That China is stockpiling gold, and Iran laughs in the face of our sanctions as they trade oil for gold with Turkey and then spend the gold on whatever they want is proof that Gold holds a unique position in financial markets and global finance that cannot be denied.
It is poor person thinking that the wealthy (global interests) have a different set of rules to play by than poor people. You and anyone you know can choose to keep little stacks of the shiny stuff stashed away as a hedge on the debt implosion that is coming, and your little stacks of paper will be worth next to nothing and my little stacks of shiny may buy a house. They might not, but it is a certainty that it will buy factors of goods that your paper will not.
Your statement that catastrophe is miles away only holds water if you (like 99% of the spoiled populace who suffer from normalcy bias and naivete) believe the good times will always roll and no large world event, like the implosion of the yen, or a war between Japan and China, or a war Between Iran and Israel will ever happen. If you believe that the debt spiral we are in as a nation and world can have some magical resolution in the future, then you are truly living in fantasy land. This is not doom and gloom. I forecast no event per se, just a reckoning for all this recklessness.
I’ve said this before, US spending falls into one of three categories: Mandatory, Discretionary, and Interest on Debt.
If you cut ALL the bullshit entitlement programs, and the rare valid good ones - EVERYTHING from the Discretionary budget, we would still be 250 MILLION short on just Mandatory Spending and Interest THIS YEAR. Harry Reid today called it a major victory for the Obama administration that the Republicans gave an 4-month kitchen pass on the debt ceiling, without getting any spending cuts.
A VICTORY???!?! Are you kidding me??? That is a victory for anyone who wants America’s currency debased out of existence.
You may be a little astray on your politics phx8, but you’re not an idiot. There is no way our debt will EVER be repaid squarely, and the day of reckoning will come. Those who see our financial situation for what it really is, will be the ones the masses turn to with their hands out because “they didn’t know things were this bad…” and I will be happy to help however I can within reason.
I am bullish and optimistic. Like Churchill, I have faith in the face of all this ridiculous social policy because I know THIS system of management cannot succeed. Him for Hitler’s Facism, me for Obama’s naked Marxism. It goes against human nature to reward sloth and laziness and corporate corruption and expect society to improve. It will crumble and out of that crumbling America will either split formally, or it will reconcile its notions of what is right and good for the individual and for society.
To Adam Ducker: Obama’s administration has recalculated the formula for unemployment more times than I have changed the oil in my car in the same number of years - specifically to obfuscate the truth about this abysmal economy.
“Obama Had to Spend 8 Trillion” you say, and yet - I watched him LIVE on TV back when he ran against McCain BLAST Bush for taking out 4 Trillion on a credit card to the bank of China, payable by our grandchildren, as unpatriotic and unamerican.
You talk out of both sides of your face.
You talk out of both sides of your face.
Posted by: Yukon Jake at January 23, 2013 5:05 P
Thanks for your post Jake. Liberals must speak with forked tongues to justify their actions. The liberals writing on WB don’t have a clue how much a Trillion is and no clue how it will ever be reduced. In fact, they don’t want a reduction in our debt and display a desire to increase in to infinity.
Because most liberals have a mental disorder, they believe it is possible to deficit spend forever with no consequences. Deficit spending earns them votes which wins elections. When the shit finally hits the fan we will find these same liberals blaming….WHO? They certainly will find no fault with their spendthrift ways.
Yukon & RF,
If you were serious about the debt and deficits, you’d be demanding spending cuts AND tax hikes.
Most Republicans never protested debts and deficits during the Reagan, Bush #41, and Bush administrations. When the country went to war in Afghanistan and then Iraq, the conservatives were silent about paying for it. Debts and deficits were fine as long as a Republican was in charge at the White House.
That tells me two things: 1) most conservatives don’t actually care about the debt; it’s just partisanship. Today, they are essentially protesting against the results of what they used to favor, because they have to be against Obama, and the reasons why don’t matter, and 2) since concern about debt seems to be limited solely to the spending side of the equation- Social Security, Medicare, Medicaid- and not at all to defense spending, then that concern about debt is being faked, because it’s really about promoting a political agenda.
When you guys start demanding cuts to defense and tax & revenue increases, let me know. When that happens, I’ll know you’re serious.
Personally, I think Obama is doing a good job of dealing with debt and deficits. It’s a symptom, a secondary problem, and the best way to solve it is to keep the economy growing. In the meantime, a slow series of steps will do a lot to address debt and deficits, including the end to the payroll tax holiday, the eventual end of extended unemployment benefits (next year, I hope), a modest tax increase (just passed), and hopefully some defense cuts in the next few months. There might be some oompromises I won’t like, but I understand that’s what it takes to get things done.
Too bad the GOP turned down the Grand Bargain compromise and then the compromise offer of chained Social Security.
As for concern about an economic meltdown, war between Japan and China, etc…
Somebody once said, “In the long run, we’re all dead.” And an ancient Greek said “Let no man say he is happy until he is dead.” Being negative and pessimistic may turn ultimately turn out to be right, but in the meantime, there’s no pleasure in it and no happiness, and amazingly enough, sometimes things actually turn out ok after all.
By the way, in his inaugural address, Obama called for an end to perpetual war. Bad news for the Military-Industrial Complex.
This is a perfect example of the problem with President Obama, his rhetoric does not match his actions.
End to perpetual war, yet he has perpetuated more war actions than any previous president, bombing five different countries at one time and deploying US assets to more. You do realize that the resources the French are using in Bali are US owned, right?
He is now working on rules for using drones in combat. He hasn’t had to do that before because he just did want he wanted, killing innocent people in several countries. However, when it looked like he might lose the election, he started working on that new playbook to hold Romney in check. Once he won, he put it on the back burner. Now he is working on it again because of the appointment of John Brennan to head the CIA, only he is making sure to ‘grandfather’ himself in, hiding the details of his bombing of Pakistan.
hat’s known about the use of drones publicly indicates a “due process” almost entirely self-contained in the White House that’s seemingly immune from disclosure. It appears President Obama is close to approving a “playbook” on the use of drones in targeted killings, which will include a one year exemption for the CIA’s drone war in Pakistan. The Bureau of Investigative Journalism estimates up to 3,400 fatalities since 2004, with up to nearly 900 civilians and 176 children, with 310 of 362 strikes since 2004 coming under President Obama. Nevertheless, the Washington Post reports that the exemption for the CIA in Pakistan was a “compromise” needed to finish the rest of the “playbook,” which has drawn criticism for codifying and not reforming the process of drone warfare.
The Industrial Military Complex has no better friend than Barak Obama…
Another great example is how he said he was going to end the discrimination of gay couples. The very next day, his press secretary was quietly out there pulling back on what he said.
Despite raising gay marriage recognition as an equality issue in yesterday’s inaugural address, today the White House clarified that Obama believes the matter properly belongs to the states.
A defense of DOMA and an interesting deferral to the states, when he doesn’t do the same when it comes to a multitude of other things, like medical marijuana, marijuana legalization, online poker, gun laws, etc.
He also states that he wants to do something about immigration and the latino nation loves him, except he has the record for the number of deportations of illegal immigrants of any president, by far.
Unfortunately, the religious defenders of the progressive cult will continue to praise what he says and ignore (or defend) what he does, ignoring the polar opposites of those two things…
No, he did not! The debt owed to the public went down in two of his years in office.
Mmmm, which two years were they?
Because as I have posted on here many times, the debt owed to the public went up every year of Clinton’s presidency.
Debt HELD by the public went down two years, but debt OWED to the public did not.
Look at http://www.treasurydirect.gov/NP/BPDLogin?application=np
From the US Treasury, we see that at the end of each fiscal year, the numbers were:
FY1993 $4.411488 trillion
FY1994 $4.692749 trillion
FY1995 $4.973982 trillion
FY1996 $5.224810 trillion
FY1997 $5.413146 trillion
FY1998 $5.526193 trillion
FY1999 $5.656270 trillion
FY2000 $5.674178 trillion
FY2001 $5.807463 trillion
What year did the number go down again?
When a trust fund (such as social security) takes in more money than it pays out in benefits, it takes the extra money and “invests” it in government bonds. Essentially social security says “We received $100 billion in social security contributions but only paid out $80 billion in benefits, so we take the extra $20 billion and buy U.S. government bonds.” Social security doesn’t keep the extra cash but rather loans it to the U.S. government and, in return, it gets a U.S. government bond. That means the U.S. government can immediately spend that $20 billion on normal government operations but owes that $20 billion to Social Security. Hence one part of the government (the U.S. Federal Government general fund) owes $20 billion to another part of the government (Social Security). That is intragovernmental debt.
Whenever a trust fund has a surplus intragovernmental debt will increase because the surplus money is automatically loaned to the federal government’s general fund. That money is then used by the federal government for its normal operations. The fact that a trust fund has a surplus simply means the federal government doesn’t need to borrow as much money directly from the public since it’s receiving extra money from the trust funds. It’s still borrowing money—just from a trust fund rather than the public.
If the combined surplus from general taxes plus the total surplus of trust funds actually results in a surplus, that means the government received more money than it needs that year. In that case it will pay down the public debt—even if intragovernmental debt has increased. That’s what happened in 2000. The combined total of taxes and trust fund surpluses exceeded the amount of money the government needed that year, and some of the extra amount was used to pay down the public debt.
Isn’t That a Surplus?
No, that’s not a surplus.
If in a given year you earn $30,000 and a friend loans you $5,000, and you spend $32,000, is that a surplus? While you can claim “I received $35,000 and only spent $32,000, thus I have a surplus,” that’s a pretty weak argument when you know that $2,000 of the money you spent was actually borrowed and has to be paid back later. That’s pretty much what happened in 2000.
You do realize that the resources the French are using in Bali are US owned, right?
Errr, Mali, not Bali…
Chadian forces advanced towards the Malian border on Tuesday as an African troop deployment and a U.S. military airlift swelled international support for French operations against Islamist rebels occupying the north of Mali.
Now, as required (and stated as such by President Obama when running for office), deploying military to another country requires the approval of the congress, yet I don’t remember seeing this come up for a vote…
Interesting, isn’t it?
when you know that $2,000 of the money you spent was actually borrowed and has to be paid back later
Except for the fact that payroll taxes are taxes, not loans. The government has no obligation to pay that money back, which was demonstrated by the Supreme Court in Flemming v Nestor. The SS trust fund is nothing short of a joke.
Isn’t That a Surplus? No, that’s not a surplus.
In FY 1999 and 2000, the US general revenue budgets had a surplus. Income taxes and other revenues, excluding SS revenue, exceeded expenditures. In those years, the SS surplus was not used to fund general governmental operations. Both the general revenue budgets and SS Trust funds were in surplus independently. However, since the SS surplus was greater than the general revenue surplus, the total debt increased by the difference due to the required purchase of US Treasury bonds by the Trusts.
There are other trust funds that the federal government has to do the same thing for (and borrowed from) in order to get that surplus that you claim existed. If you exclude all of those funds (most of them are retirement plans of some sort) then no, there was no surplus.
The above Factcheck statement acknowledges the fact that Social Security trust fund surpluses really don’t have anything to do with the president’s budget, nor can they really be considered part of a surplus since they’ll have to be paid back to Social Security later. So they argue that even if you don’t count the $149.8 billion Social Security surplus, President Clinton was still responsible for an “on-budget” surplus of $86.4 billion (actually the numbers are $87.2 billion on-budget and $149.8 billion off-budget/Social Security according to to table 2 of the MTS ; I’m not sure where Factcheck got its numbers… but their numbers are close enough).
What Factcheck does not mention, however, is that while Social Security is the only off-budget trust fund, it’s not the only trust fund. Just as surpluses caused by Social Security should not be considered a real surplus caused by a president’s budget, nor should surpluses caused by other trust funds be considered. The following table shows the major trust funds that contributed to surpluses in 2000. These numbers come from Table 6 Schedule D of the MTS for September 2000 . That table contains a complete list of all the trust funds and government accounts that contributed to the “surplus” due to their excess funds.
TRUST FUND SURPLUSES IN 2000 (table 6 schedule D)
Social Security $152.3 billion
Civil Service Retirement Fund $30.9 billion
Federal supplementary medical insurance Trust fund $18.5 billion
Federal Hospital Insurance Trust Fund $15.0 billion
Unemployment Trust Fund $9.0 billion
Military Retirement Fund $8.2 billion
Transportation Trust Funds $3.8 billion
Employee life insurance & retirement $1.8 billion
Other $7.0 billion
TOTAL $246.5 billion
As can be seen from Table 6 Schedule D of the Treasury Department’s MTS , all the government’s trust funds contributed a total of $246.5 billion to the “surplus.” That is extra money that was contributed to trust funds for the specific trust fund purposes, not as taxes, and is $246.5 billion that the U.S. government now owes to those trust funds and will have to pay back in the future. And although the government took in that extra $246.5 billion in non-tax revenue from those trust funds, the MTS indicates it only reduced the public debt by $223 billion. That’s why even with all the excess money coming in from the trust funds, the national debt went up. The government received extra money from trust funds but didn’t use all of it to reduce the public debt. Some of it was used on normal government spending during 2000.
BTW, while it is interesting and enlightening to see how our government officials use accounting tricks to lie to us and how they have the nerve to claim a surplus when we still had to borrow more money, the fact is that we still have to borrow more money each year under Clinton. You can’t have a true surplus and borrow money, by definition.
A good example of how this was trying to be pointed out at the time by a Democrat who was not happy with this type of ‘accounting’.
So the table itself, according to the figures issued yesterday, showed the Federal Government ran a surplus. Absolutely false. This reporter ought to do his work. This crowd never has asked for or kept up with or checked the facts. Eric Planin—all he has to do is not spread rumors or get into the political message. Both Democrats and Republicans are all running this year and next and saying surplus, surplus. Look what we have done. It is false. The actual figures show that from the beginning of the fiscal year until now we had to borrow $127,800,000,000. - Democratic Senator Ernest Hollings, October 28, 1999
BTW, if a private company used this type of ‘accounting’, basically raiding the trust funds of their employees and then claiming a profit, most people would agree that they should be put in jail.
The United Nations announced this morning the official launch of an investigation into targeted killings by the United States and other governments. The inquiry will be led by Ben Emmerson, the U.N. special rapporteur on counterterrorism and human rights. The results of the investigation, to be run from Geneva, will be reported to the U.N. General Assembly in the fall.
“We welcome this investigation in the hopes that global pressure will bring the U.S. back into line with international law requirements that strictly limit the use of lethal force,” said Hina Shamsi, director of the American Civil Liberties Union’s National Security Project. “Virtually no other country agrees with the U.S.’s claimed authority to secretly declare people enemies of the state and kill them and civilian bystanders far from any recognized battlefield. To date, there has been an abysmal lack of transparency and no accountability for the U.S. government’s ever-expanding targeted killing program.”
Wondering when he is going to give back that peace prize of his…
I WAS the biggest critic of GWB’s economic policy EVER! Stephen would routinely decry me for being a phoney because I agreed with many things that he did but was appalled by the spending proliferation and patriot act.
The debt IS serious. We continue to operate without a budget and print money by the hundreds of billions.
You can sing La la lala la laaaaaaa all day long. If you’re in a freefall, optimism that you’ll be the one out of 10,000 who bounces and lives doesn’t make it any more likely.
And I’ll bet anyone a Silver Morgan Dollar that when the reckoning comes, the leftist idiots on this blog will try and say the debt problems are either ALL the fault of the Republicans, or are at least equal in blame to these knucklehead marxists.
Tomfoolery and shame on the left.
Rand Paul questioning John Kerry, I love getting these answers on video…
Above is a great conversation between Sen. Rand Paul (R-Ky.) and the failed 2004 presidential candidate, who got his start in public life by (rightly) denouncing the Vietnam War in which he had served. Among the basic questions that Paul asks of Kerry: If the U.S. was wrong to bomb Cambodia without congressional authorization (and it was), then why was it A-OK for Obama to join in bombing runs over Libya?
Another excellent question raised by Paul: Why are we sending big fancy fighter jets to Egypt even as the leader of that country is going full Capt. Queeg, with a fixation on the Jews standing in for obsession about stolen strawberries?
This sort of common-sense exploration of the WTF that is U.S. foreign policy should be at the forefront of any American who gives a hell about limited, legitimate government and the Constitution.